Sunland Corporation has outstanding 200,000 common shares that were issued at $11 per share. The balances at January 1, 2023, were $20 million in its Retained Earnings account: $4.40 million in its Contributed Surplus account; and $1.10 million in its Accumulated Other Comprehensive Income account. During 2023, Sunland's net income was $3,100,000 and comprehensive income was $3,150,000. A cash dividend of $0.50 per share was declared and paid on June 30, 2023, and a 4% stock dividend was declared at the fair value of the shares and distributed to shareholders of record at the close of business on December 31, 2023. You have been asked to give advice on how to properly account for the stock dividend. The existing company shares are traded on a national stock exchange. The shares' market price per share has been as follows: Oct. 31, 2023 Nov. 30, 2023 Dec. 31, 2023 Average price over the two-month period $29 33 38 34
Sunland Corporation has outstanding 200,000 common shares that were issued at $11 per share. The balances at January 1, 2023, were $20 million in its Retained Earnings account: $4.40 million in its Contributed Surplus account; and $1.10 million in its Accumulated Other Comprehensive Income account. During 2023, Sunland's net income was $3,100,000 and comprehensive income was $3,150,000. A cash dividend of $0.50 per share was declared and paid on June 30, 2023, and a 4% stock dividend was declared at the fair value of the shares and distributed to shareholders of record at the close of business on December 31, 2023. You have been asked to give advice on how to properly account for the stock dividend. The existing company shares are traded on a national stock exchange. The shares' market price per share has been as follows: Oct. 31, 2023 Nov. 30, 2023 Dec. 31, 2023 Average price over the two-month period $29 33 38 34
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Prepare Sunland's shareholders' equity section (of the SFP) for the year 2023 based on the information given. Prepare a schedule
outlining the activity in the Retained Earnings account for the year.
Pald-in Capital
Common Shares
Contributed Surplus
Total Paid-in Capital
Retained Earnings
Accumulated OCI
Total Shareholders' Equity
Balance, January 1, 2023
Net Income/Loss)
Less V
Cash Dividend
Stock Dividend
SUNLAND CORPORATION
Shareholders' Equity
December 31, 2023
Dividends on Common Shares V
>
SUNLAND CORPORATION
Continuity Schedule of Retained Earnings
For the Year Ended December 31, 2023
Balance, December 31, 2023 V
$
Transcribed Image Text:Sunland Corporation has outstanding 200,000 common shares that were issued at $11 per share. The balances at January 1, 2023,
were $20 million in its Retained Earnings account: $4.40 million in its Contributed Surplus account; and $1.10 million in its
Accumulated Other Comprehensive Income account. During 2023, Sunland's net income was $3,100,000 and comprehensive income
was $3,150,000. A cash dividend of $0.50 per share was declared and paid on June 30, 2023, and a 4% stock dividend was declared at
the fair value of the shares and distributed to shareholders of record at the close of business on December 31, 2023. You have been
asked to give advice on how to properly account for the stock dividend. The existing company shares are traded on a national stock
exchange. The shares' market price per share has been as follows:
Oct. 31, 2023
Nov. 30, 2023
Dec. 31, 2023
Average price over the two-month period
$29
33
38
34
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